Posts tagged ‘Bolivia’
Any Kiva Fellow will tell you that visiting Kiva borrowers is one of the most satisfying parts of our experience. This is our moment to go beyond the borrower photographs and short biographies on the Kiva website. We greet borrowers by shaking hands and kissing cheeks, we sit in their homes, we walk through their fields, we touch the garments they sew and taste the baked goods from their ovens, we learn the names of their cows, and we try to make their children smile.
These are moments when we transcend the digital world and our Kiva connections become human.
Señor René, Vegetable Farmer, Cochabamba (CIDRE)
Señor René lives in a high-altitude farming community a couple of hours from Cochabamba. His several small parcels of land are perched on the slopes of the Bolivian Andes that reach eastwards. The views of the surrounding peaks, the nearby farms and the valley below are simply magnificent.
He lives in a one-room adobe home with his wife and four children. The Kiva loan helped pay his one-time share in the community irrigation system which allows him to double his agriculture production since he can now grow crops after the rainy season.
René and his family received me and my CIDRE colleagues with extreme generosity. We were served a tasty and healthy almuerzo (the sustaining midday meal) of home-made cheese and hot salsa, fresh steamed broad beans and boiled potatoes that were harvested from their garden that morning.
During the meal we talked about his farming. He is genuinely grateful for the Kiva-funded loan and the low interest rate — this goes a long way in helping support his young family.
As we were leaving he surprised us with a fat bag of fresh-picked beans. It was a large gesture that the CIDRE loan officers especially appreciated. He thanked me personally for coming all the way from the United States to spend time with him.
Pointing over the distant mountain peaks, René asked me to pass along his greetings and thanks to everyone at “home.” I smiled, looking over those mountains knowing that everywhere is home to the Kiva family.
Señora Yelica, Baker, Santa Cruz (Emprender)
The heat of eastern Bolivia can be intense. As soon I reached the shade of Señora Yélica’s backyard she handed me a cold glass of Coca Colla, Bolivia’s coca-leaf enhanced “real thing” soft drink.
Her property on the outskirts of Santa Cruz is filled with flowering fruit trees: orange, mango, papaya, avocado, pomegranate and fig. This is tropical Bolivia and she takes full advantage of the sun, warmth and rich soil to supplement her family’s diet with fresh fruit right from her backyard.
Rising early seven days a week, Yélica bakes dozens of pan de arroz (a bread of yucca meal, rice flour and cheese encased in banana leaves) and cheese empanadas. She sells these to neighbors but with her Kiva-funded larger oven she can now sell in the markets for more income.
She offered me samples of all her baked goods, covered with cotton towels to keep them warm. She introduced me to her smiling grandmother who listened intently to our discussion and enjoyed watching this visiting foreigner trying his best to keep the sweat from rolling down his brow. We laughed about her lazy pets, a sleeping puppy in the shade beneath a wheelbarrow and a curled-up kitten.
It was a sublimely pleasant visit. Graciously welcomed by outgoing hosts amid a lush paradise, my thoughts lingered on the joys of being a Kiva Fellow at times like this.
Señor Gustavo, Magician, La Paz (CIDRE)
As soon as I stepped into Señor Gustavo’s home workshop, I knew this would be like no other borrower visit. I was surrounded by stacks of boxes, cardboard, playing cards, coins, yarn and CD’s – there were enough Kiva-funded materials to assemble 1,000 Maletines de Magia, the magic kits he sells at fairs throughout Bolivia.
He welcomed me with a huge smile and immediately the show began. He jumped right into performing tricks, explaining the design and manufacturing process, and how he sells these at fairs. Gustavo is a seriously committed to his business. A fan of magic as a child, he has now made it his livelihood. He designs his magic kits to be especially didactic for children, helping them develop cognitive abilities, such as basic math, counting, probability logic and pattern recognition.
As I sat back in my seat, I was amused and awestruck by his magic… and equally impressed at how simple the tricks are once he explained them.
After half an hour of the “Don Gustavo Show” I had to get down to business and verify some key details of his loan. He answered my questions but his mind was clearly on his next Kiva-funded loan as he quickly dove into an enthusiastic pitch of his next “Magic Kit” project.
The CIDRE loan officer wryly explained that he’d still need to stop by the office to fill out the paperwork. He grinned broadly as she told him that Kiva funds can’t simply be pulled from a hat.
Some truly magic moments with Kiva borrowers!
Peter Soley is a Kiva Fellow (Class 19) serving in Bolivia (La Paz, Cochabamba, Santa Cruz) with CIDRE and Emprender. Become a member of their lending teams (CIDRE, Emprender), lend to one of their borrowers today (CIDRE, Emprender), or apply to be a Fellow!
“Do you know the real San Severino?” asked the inebriated man next to me on the bus back to Cochabamba. “The real San Severino!”
I wasn’t too sure exactly what he meant; the real San Severino died over 1500 years ago. “Well, um, I know he was a saint, from Europe I think, who brings the rains…” I stumbled but tried my best to answer him.
“Bah! No one knows the real San Severino!” he blustered.
After a moment the question came again: “Do you know the real San Severino?” I knew this was going to be a circular conversation making the hour-long ride seem even longer. So I countered and turned the question on him.
“Ahh… ¡si pues!” He raised his right hand emphatically: “San Severino… he was… um… a Christian and a patriot… from the early republic, who… uh…” After an uneasy pause he dropped his hand in exasperation.
Snickering behind us, I spotted a couple of grinning chola woman looking at us. They were swearing those lovely shiny dresses and colorful bonnets typical of the indigenous women here. I smiled at them and asked if they knew who the real San Severino was.
They just shook their heads and laughed.
Apparently, even the faithful who come to celebrate the festival of San Severino don’t know who the real saint was. I admit there are a lot of Catholic saints to remember, numbering well over 10,000. But at the end of the day, when the processions, fireworks, drinking and dancing were over, here in Bolivia it really doesn’t really matter who the real San Severino was.
What matters is the celebration in the streets. A celebration for the change of seasons and a time to welcome the hot sun and the saturating rains. It is a time to revel with family and friends (and strangers, like myself) with good food and dance. It is a time to rejoice that the rains will bring growth and abundance to everyone.
Old Traditions Die Hard: Lliupacha Yuyaychay (The Andean Cosmovision) + Christianity
For thousands of years festivals in Bolivia have celebrated the unity of the physical and spiritual worlds through pagan rituals and dances, centering on the Pachamama, the supreme and life-giving Mother Earth goddess. Natural cycles, especially seasonal change, have long meant party time in the Andes.
The conquering Spanish were intolerant of the local religious traditions and tried hard to erase paganism. But Christian beliefs never fully replaced the existing practices, as is evidenced in the syncretism of such powerful religious icons as the Pachamama and the Virgin Mary. Today most Bolivians practice a combination of both Catholic and pre-Hispanic rituals.
San Severino, Patrono de Tarata
Enter San Severino, an Italian saint who died over a thousand years before the Americas were known to modern Europe. Some of his remains were allegedly brought to Tarata with the Franciscan missionaries who established a church here during their evangelical march eastward.
It is said that during the first procession on the saint’s feast day (actually in early January), it rained so hard that the locals were convinced that San Severino was responsible. This milagro (miracle) secured his fame here as the Patron Saint of the Rains.
Because San Severino was such a hit with the locals, the Franciscans conveniently changed his feast to coincide with the traditional rainy season welcoming rituals already in place. And tah-dah: the San Severino festival was born. Or born again.
Today thousands flock to Tarata to worship the saint who will bring the all-important downpours needed to replenish wells, dampen fledgling crops and quench the thirst of livestock. Farmers carry pitchers of water blessed in Tarata to sprinkle in their fields, venerating both San Severino and the Pachamama.
Tarata: Small Town with a Big Reputation
Tarata today is a one-horse town with fewer than 3000 inhabitants but it boasts favorite-son Bolivian Independence hero Esteban Arze and three former Presidents of Bolivia. The most infamous being Mariano Melgarejo, a brutal autocrat who is remembered for giving a large chunk of Bolivia to Brazil in exchange for a white horse (he allegedly traced the horse’s hoof on a map of Bolivia to designate the parcel).
Normally a quiet town, the cobblestone streets come alive as the faithful and fun-seekers arrive en masse for San Severino. Events kick off the last Saturday in November with the entrada (inaugural procession) and an evening of fireworks, drinking, dance and general revelry.
Dancing In the Streets: San Severino Sunday
The following day a solemn mass is celebrated at the church and the San Severino statue is carried through the streets. This ends the Catholic part of the celebration. The rest of the day is spent drinking, dancing and watching the energetic fraternidades (fellowships of marchers) parade through the streets in flashy costumes, dancing, and singing mostly in Quechua (the language introduced by the Incas).
Chorizo y Chicha: Full Flavors in the Streets
And of course no Latin American festival would be complete without a vast assortment of street vendors. Hand-cranked ice cream, fresh fruit, fried potatoes, sweet gelatine, good luck charms, handicrafts, ceramic jugs to carry holy water and chicha, games and children’s rides… something for everyone.
Most conspicuous were the meaty morsels in large cooking vessels that lined the main streets. Tarata is known for its chorizo sausage and there was plenty of supply for San Severino’s feast.
Of course there was chicha, the beloved corn beer that is ever-present in the Cochabamba region. Cooked above huge adobe fireplaces and fermented in oversize terracotta jugs, chicha is served up in buckets and consumed liberally from dried-gourd saucers.
Chicherías are everywhere in Tarata, just look for the little white or red flags hanging outside homes. And one mustn’t forget to spill a little on the ground in honor of Pachamama when it’s your turn to drink!
Finding Friends and More Fun
I find most Bolivians to be warm and especially courteous but today they were overflowing with affability. I enjoyed the many smiles in the streets and I made new friends over shared buckets of chicha while watching the processions pass.
I was happy to run into Mario, a CIDRE colleague of mine. He introduced me to his family and friends and fed me peanuts fresh from his farm. We spent a good time chatting and joking and enjoying the festival.
By late afternoon the processions had ended, the grilled meat stands disappeared and the chicherías slowly became quieter.
And I noticed that the sky was turning a bit darker… it seemed in every way the San Severino festival was a success!
Peter Soley is a Kiva Fellow (Class 19) serving in Bolivia (La Paz, Cochabamba, Santa Cruz) with CIDRE. Become a member of CIDRE’s lending team, lend to one of their borrowers today, or apply to be a Fellow!
Agriculture has long been the anchor for the people of land-locked Bolivia. As a testament to the region’s horticultural richness, the number of foods originating here is impressive: potatoes, chili peppers, peanuts, pineapple, kidney beans, manioc, quinoa… foods we all know and should love.
And nowhere else in Bolivia is farming as vital as in the Central Valleys near Cochabamba, an area blessed with ideal climate and naturally rich soils. This is where I have been working with CIDRE, one of Kiva’s partners, and I am learning much from Kiva borrowers (quite literally) in the field.
The Incas colonized Cochabamba to help feed its growing empire. Then the Spanish arrived, introduced dairy farming and exploited the Quechua locals with the hacienda system. The conquistadores’ pressing concern was to provision the Potosí silver mines which provided much of the wealth to world-power Spain.
Today much of the land has been redistributed more equitably and farming continues to fuel the Cochabambino economy.
But there are powerful challenges:
Land: Low Supply, Rising Prices and Deteriorating Quality
While the 1952 Revolution in Bolivia went a long way in granting farmers their own plots, the last decade has seen land prices increase dramatically due to urbanization, limited turnover since family plots rarely change hands, and increased demand from migrants seeking better opportunities in the Cochabamba area.
Rising prices have encouraged some farmers to sell, usually to larger landholders and cash-flush immigrant Bolivians returning from abroad. This all adds up to great demand for land but low supply for most Bolivians.
Soil degradation is another major problem. Years of deforestation, excess grazing and rapid urbanization cause heavy erosion that washes away valuable nutrients needed to strengthen the soil. Decreased land productivity requires more chemical fertilizers and genetically modified seeds, resulting in higher costs to farmers and arguably less healthy food for consumers. It puts at risk the lives of countless rural Bolivians who depend on the land for their survival.
Advances in past decades have greatly expanded farmers’ access to water for irrigation. Kiva’s partner CIDRE did some pioneering work in the 1980’s to introduce wells and canals to under-served rural areas. Most farms now yield three crops per year, an increase from 1-2 previously.
But adequate supply of clean water is still a concern: expanding (and thirsty) urban centers, shrinking glacier-fed sources, and a sharp increase in contamination are limiting factors. Cochabamba’s Water War of 2000 made international headlines when massive popular protests halted the privatization of the public water works.
Without water there is no growth. Sadly, the water problems facing Bolivian farmers have few real solutions today.
Climate Cycles and Change
Weather in Bolivia has long been extreme: a long dry season (usually culminating in drought) and a saturating rainy season. Many parts of Cochabamba’s valleys flood during the months of December to March which dramatically reduces available pasture. Moving cattle to higher elevations, pasture rental and additional fodder all increase the costs to farmers during this period when dairy production (and income) is low.
Global factors compound these normal patterns. Bolivia’s glaciers are disappearing. Unprecedented shifts in weather, such as more frequent hailstorms, can wipe an entire crop in minutes. Severe thunderstorms obliterate fields and collapse stables. Gradual warming in the higher altitudes, while allowing for a more diverse crop portfolio, has introduced new pests and other problems that leave local farmers unprepared.
You don’t have to listen to scientists if you don’t want to. Just ask the farmers: climate change in Bolivia is real.
New Demands for Dairy Producers
As consumer demand for dairy products has grown, so too have the burdens on Bolivian farmers. Few alternative outlets exist so most dairy farmers must sell crude milk at increasingly lower prices to large-scale industrial producers, such as the behemoth Pil Andina. While industrial producers have introduced new quality controls which lead to healthier and safer dairy products, farmers must pay for more expensive production methods which squeeze profits.
Only farmers who can achieve greater economies of scale are doing well. Smaller farmers face extinction. As a consequence of newer technology (fortified feed, milking machines, and storage tanks) there are fewer manual day-wage jobs which hits landless Bolivians especially hard.
Bolivia faces tremendous hurdles in getting its agricultural products to markets abroad. Stiff competition with far-more-industrialized Argentina, Brazil and Chile (who also control access to ports) puts Bolivia at a distinct disadvantage with regional partners.
Moreover, the recently-expired Andean Trade Promotion and Drug Eradication Act (ATPDEA) which favored Bolivia with duty-free status, no longer covers nearly 30% of Bolivian exports to the United States. Several people told me this as yet another uncertainty facing Bolivian farmers today.
Finally, agricultural production is far below optimal levels. Many farmers still till their fields with wooden plows dating from the colonial period. And massive emigration in recent years of able-bodied Bolivians has left many fields fallow. Bolivia doesn’t normally produce a surplus but when it does the transportation costs to ship the goods abroad neutralize its competitive advantage in price.
Despite all this, what seems to work for farmers in the region?
Many take out small loans, frequently with the help of Kiva, to help manage the agricultural ups and downs. They invest in feed futures to avoid spiking prices during drought. They use the extra capital to build stables, drainage ditches and sustaining walls to protect their farms from the rains.
Some supplement their income with non-farm work, such as construction or transportation. Others cultivate niche products, such as preserves, honey or quesillo cheese to sell at local markets.
Others turn to the community and leverage the collective power of farmers. They join farmer cooperatives to purchase storage tanks to aggregate products for higher prices or pay for shares in community-owned reservoirs and irrigation canals.
Farmers are an enterprising bunch and manage to find ways to move forward.
So, what does the future look like for farmers here?
Despite continuing urbanization and many young Bolivians finding work in the cities, there is a farming future here. The national government has few resources to carry the agricultural sector to a profitable and sustainable future, but many NGO’s are working hard to help bridge the gap.
Of course, Kiva’s field partners in Bolivia have a strong history of helping farmers grow their businesses and succeed in spite of the environmental and economic challenges. They continue to offer innovative funding options to clients with the help of Kiva loans.
One of the first dairy production projects in Bolivia, the Simón I. Patiño Foundation on the outskirts of Cochabamba offers state-of-the-art research on non-GMO plants, a seed center, and model dairy farm. It eminently influences farmers in the area.
Other organizations are working with farmers to develop soil stability and crop diversification programs, such as planting barrier and cover crops (i.e. supporting grasses and legume “green manures”) to increase soil fertility without chemicals.
Many other groups, such as the Foundation for Sustainable Development, are expanding the capabilities of nonprofit organizations to implement other sustainable solutions that include and empower local communities.
The future of farming in Bolivia may not seem entirely bright. But with steady progress in recent years on increasing environmental awareness in the general public and implementing lasting changes in the agricultural sector, the future promises to be green!
Compiled by David Gorgani | KF17 + KF18 | Guatemala
Through motivating stories, informative videos, intriguing sound bytes and interesting first-hand accounts, this week’s update is quite the smorgasbord of stories from the field. Through accounts of first business loans and stories about successful community banks, Fellows in Georgia and Peru show us the effects of our loans; through sights, sounds and narratives, Fellows in Guatemala and New Orleans (among others) show us – and let us hear – bits of their daily lives; and through detailed accounts of interactions with field partners, Fellows in Burkina Faso, Uganda and Bolivia show us the great work Kiva’s collaborators are performing on the ground.
Compiled by David Gorgani | KF17 + KF18 | Guatemala
As we begin to get a feel for our new placements and our new countries, we Fellows have also begun to ponder items ranging from local business realities to simply why we love what we do. The nine posts in this update give a great deal of insight into the work of a Fellow, local culture in the locations in which we are placed, and most importantly, where these elements come together to give a brief overview of what it means to be a newly-arrived Kiva Fellow.
All is not quiet on the homefront. Challenges to conducting business and living life in La Paz, Bolivia
By Isabel Balderrama | KF17+18 | Bolivia
When thinking of the wide swath of qualities that make up a Kiva Fellow, one can be certain of the one trait all fellows possess: an unequivocal thirst for exploring unfamiliar territory.
A fellowship assignment presents us with the thrill of being given an opportunity to quench this thirst as it often sends us flying halfway across the world (and sometimes even further), thousands of miles away from our places of birth and comfort zones.
So here I find myself, on my second Kiva fellowship assignment with Kiva Fellows class 18 in La Paz, Bolivia: the country and city where I was born.
But before you go on feeling sorry for me for having had the bad luck of missing out on halfway-around the-world travel opportunities, you must know that I wanted this.
Compiled by Jim Burke, KF16, Nicaragua
We are Kiva Fellows. This is the stuff we like. Here is an insider (often critical, or satirical but always true!) view of what it means to be a Kiva Fellow and promote access to financial services around the world. From party crashing to bazaars to street food, these are the things we like and thrive on. Check out Stuff Kiva Fellows Like (SKFL) #1-9!
#10 Street Food
Mariela Cedeño, KF16, Cochabamba, Bolivia
I’m not really sure why, but there is something inherently appealing to a Kiva Fellow’s being about food that is prepared, cooked, and sold on the streets. Perhaps it’s the dubiously hygienic food preparation, the alternative cooking apparatus used to bring food to fire, or it’s ready availability and our relative laziness…wait, no, it’s actually our need to literally ‘taste’ the local culture. In our fits of street food deliriousness we are open and ready to taste all that our surroundings have to offer, however, we often find that the local fare may not quietly find a home in our stomachs. Thankfully, before leaving to our local assignments, our travel nurses reminded us that in times of intestinal woe, Cipro and other like antibiotics will be our best friend. They sometimes are, but because we are well versed in the dangers of overusing antibiotics and are haunted by nightmares of creating giant super bacteria that start kidnapping local women and children, we use them sparingly and wisely. (more…)
By Nila Uthayakumar, KF14, Uganda,
With the help of several other Fellows in the field
I’ve met all kinds of borrowers. From age 16 to 76; from orphans to a former beauty queen; from potato sellers to auto parts saleswomen to motorcycle transportation tycoons. I’ve met them in urban slums, in villages, in homes, on porches, in churches, in community centers, and outside in grassy fields. I’ve listened to their stories, I’ve photographed and filmed them, I’ve played with their children, and I’ve been welcomed into their homes. Two months into my Kiva fellowship, and I am more motivated and inspired than ever. My name is Nila and I live and work in Kampala, Uganda.
What I have understood from these borrowers is that poverty takes many shapes and forms. Poverty can mean desperation and destitution, and it can also mean having to make impossible choices between paying medical bills or school fees. It can mean not having enough food to eat today, or not having a secure enough future to be able to retire. The microloans I have seen in action place into the hands of borrowers the power to shape their own lives. The recipients of these loans are among the most dignified people I have ever met, and when given the chance, these individuals make tremendous improvements in their lives. (more…)
Clara Vreeken, KF 14, Bolivia
Clara volunteered as Kiva Fellow in Bolivia. She worked for the micro finance institutions IMPRO, Pro Mujer and Emprender. In this blog she elaborates on health issues in Bolivia – Bolivians prefer to drink herbal tea and listen to witch doctors instead of seeing a doctor – and she says goodbye as the end of her Kiva Fellowship has arrived.
Compiled by Caree Edson, KF 14, Armenia
One of the unfortunate sight-seeing adventures that you never sign up for when you travel (especially in developing countries) is the unseemly amount of trash cluttering the otherwise beautiful landscapes. In Armenia, it isn’t possible to see the horizon through the smog most days and the streets are covered in cigarette butts and litter. I found no exceptions to this as I inquired from other Kiva Fellows about the dire situation in their countries. Environmental education and reform are simply not a top priority in many countries. But the future of climate change initiatives are not entirely hopeless…
Clara Vreeken, KF 14, Bolivia
Clara volunteers as Kiva Fellow in Bolivia. She works for three micro finance institutions. She verifies borrowers’ data, implements changes and informs the lenders about Kiva’s entrepreneurs. In this blog she elaborates on her tasks as a Kiva Fellow.
Clara Vreeken is a Kiva Fellow in Bolivia, where she works for IMPRO, Pro Mujer and Emprender. Last week mud torrents destroyed 400 homes in the capital La Paz. Climate change in Bolivia leads to less food production, hunger and protests in the streets.
Compiled by Geeta Uhl, KF14, Peru
Kiva Fellows celebrate Carnival in the Andes- in Ayacucho and Cajamarca, Peru and Oruro, Bolivia. Check out photos and descriptions of the various celebrations and traditions in South America.
Julie Shea, KF13, Bolivia
A few months ago, I wrote a blog post that drew on my experiences as a Kiva Fellow in Bolivia to discuss two points of criticism about microfinance, specifically from Aaron Ausland’s Huffington Post article, “How Microfinance Lost its Soul”. In this second installment, I will attempt to do the same, focusing on the portrayal of microfinance put forth by Tom Heinemann’s controversial documentary, The Micro Debt.
Compiled by Alexis Ditkowsky, KF14, South Africa
Members of the 14th class of Kiva Fellows have officially hit their stride. While we never know where the next dispatch will come from or what interesting topics the Fellows will cover next, we always know we’ll be transported, entertained, and edified. This past week, topics included “Christmas”, trekking to a remote village (with video!), handling adversity (including a serious car accident and stolen electronics), and enjoying the company of loan officers, borrowers, and community members. Enjoy!
Bolivian Kiva borrowers: buying a cow, selling food, acquiring sewing machines and constructing rooms
In this second blog of Clara Vreeken, you can meet the Bolivian borrowers of Kiva’s field partner IMPRO: Pascuala and Santos buying a good-quality dairy cow, Maria selling food and renting small accommodations, Juan Carlos and Mery buying more sewing machines and Mery’s mother Maria constructing rooms. 43% of IMPRO’s clients live from 1 dollar or less per day. IMPRO serves clients in rural areas (11%) and in two big cities (89%). 45% of IMPRO’s 2147 clients are women.
By Julie Shea, KF13, Bolivia
A few months ago, I wrote a post discussing the advantages and drawbacks of financial institutions offering their clients healthcare services. Throughout the course of the past few months, my time spent working in ProMujer’s office has afforded me the opportunity to gain a deeper understanding of clients’ healthcare needs and the services provided to them by ProMujer. A recent conversation with Ruth Apaza, the supervisor of all nurses in the El Alto region, shed light on ProMujer’s healthcare services: why it’s an important part of their model, how they work with the women, and the challenges they face.
By Clara Vreeken, KF 14, Bolivia
Blog 1: My name is Clara and I have started my Kiva Fellowship last week at the field partner IMPRO in Bolivia. IMPRO is a small non-profit organization that has been offering micro credit to the working poor in the cities of La Paz and El Alto in Bolivia since 1995. In this first blog I describe how Kiva works by using the example of IMPRO in Bolivia.
By Julie Shea, KF13, Bolivia
Kiva strives to connect microfinance borrowers and lenders from all corners of the globe – and one medium through which it is able to accomplish this is the Kiva Fellows blog. I would therefore like to dedicate this post to telling the story of Javier Aguilar Soto, what I learned from meeting with him, and some broader lessons I gained, through the meeting, about the field of microfinance.
By Julie Shea, KF13, Bolivia
As a Kiva Fellow and ardent believer in the poverty alleviating potential of microfinance, I make an effort to keep abreast the developments and discussions within the industry, both from the practical and academic side. While I find myself frustrated over negative articles or comments that oppose much what I am witnessing as a fellow on the ground, I must remind myself that this criticism can lead to constructive debates, and ultimately to advancements and improvements within the field.
By Julie Shea, KF13, Bolivia
Upon starting my fellowship at ProMujer Bolivia in La Paz, I became quickly aware of the fact that this microfinance institution (MFI) offers its customers one thing that the other MFI’s I’ve worked with and observed don’t, namely healthcare services. In a country where national health data show high infant and maternal mortality, and the lowest life expectancy in Latin America*, the value of these services offered by ProMujer is obvious. However, a part of me questions the notion that a person’s access to healthcare and health services should be so intricately linked to his or her business loan.
By Julie Shea, KF13, Bolivia
For me, one of the most interesting and potentially controversial challenges for Kiva’s lending model revolves around the concept of posting photographs and stories about real people, their lives, and their financial activities – and the privacy issues this entails. There are undoubtedly millions of microfinance clients that live in such remote areas that they don’t know what the internet is, or even if they do, lack knowledge and understanding about the speed and extent to which information can travel. How do we explain to these people how the Kiva model works and how their information will be used?
Everywhere I go in Bolivia I see huge billboards that advertise “Mini Carga desde 1 Bs” (Mini recharge from 1 Boliviano) with a picture of a guy holding a 1 Boliviano coin and a cellphone.
Mini Carga desde 1 Boliviano (Mini-Recharge from 1 Boliviano)
Mini Carga desde 1 Boliviano
After having my Bolivian cellphone for only a day, I couldn’t for the life of me understand why companies were advertising such a small sum of money to recharge your pre-paid phone. Especially since a phone call of a few seconds would eat that 1 Boliviano before you could say “hola” (although text messages are much cheaper, around 20 Bolivian cents each depending on the company – Entel, Tigo or Viva). It seemed so inefficient. But then I talked to a friend who has lived in Bolivia longer than I have, after which I couldn’t help but think of the similarities between mini carga and microfinance.
So here’s the scoop…
I met some Dutch Kiva lenders during a trip to Isla del Sol, Lake Titicaca in Bolivia who don’t like to loan to groups on Kiva.
Both the MFIs I have worked with as a Kiva Fellow, Asociación Arariwa and Emprender offer both group and individual credit products, however, the majority of Arariwa’s clients and 40% of Emprender’s clients work within a banco communal (village bank). A banco communal basically acts like a mini financial institution. The MFI gives each member credit based on the amount they have requested and their ability to pay. Each member saves part of their loan and in some cases, can relend this money within the group and collect interest on this internal loan.
Here are some reasons why group loans work well in microfinance…
Since Evo Morales and the Movement Towards Socialism came to power in 2006, Bolivian microfinance institutions (MFIs) have worried that the government will intervene in the industry, to the detriment of private sector providers. Indeed such concerns have become a common theme across the region, with increased government involvement in microfinance in Venezuela, Ecuador and Colombia.
Since beginning to work in La Paz, Bolivia with microfinance institution and Kiva partner Emprender, one of the first things I wanted to learn was how to tell a fake Bolivian bill from a real one.
Every Emprender office has a caja (cashier) where clients get their loan disbursement and pay their loan payments. Each cashier has a sign that says “Every fake bill will be perforated” with a sample fake bill stuck on the window.
The institution is vigilant about fake bills. When a client pays their loan payment, their initials are marked on the bill and the cashier examines it to determine its authenticity. In the case it is deemed to be false, the bill is returned to its owner and the payment must be made again.
Here are some ways to tell the difference between real and fake bills in Bolivia from the cashier at the Emprender Pampahasi branch…
Carnaval! The excitement summoned up by uttering those words: Carnaval!
Carnaval is a very interesting holiday for all sorts of reasons, and is celebrated in a variety of forms all across South America, most of which involve colorful costumes, thumpingly loud music, crazy line dancing and (if you’re lucky) some kind of substance rubbed into your head, ranging from shaving cream to flour. Kiva Fellows currently stationed across South America took a break from their workloads in order to scope out the scene …
It´s a loan for someone who was unable to get a loan from a mainstream bank because they didn´t have the necessary paperwork or their income was too low or too volatile. The borrower is likely from a marginalized group, perhaps a migrant family. The loan costs more than a bank loan would cost, but the alternatives for this borrower are even more costly. The lending institution might hold these loans on their balance sheets, or they might sell them on to someone else…
So what are we talking about here, a typical Kiva loan or a subprime mortgage? Is there anything inherently different between the two?
If you haven’t heard, there have been terrible floods in Cusco, Peru in the past week. Since we are in the thick of La Epoca de la Lluvia (the rainy season), rain is expected but the level of destruction seen in the area is unimaginable.
Tourism is the main industry in Cusco, and the damage produced by the rain does substantial damage on the Cusco economy. From the February 3rd warden message from the U.S. Embassy in Peru, I read that Machu Picchu is closed and the rail line between Ollantaytambo and Aguas Calientes is closed due to landslides until possibly March. I also read that tourists were stranded in Aguas Calientes (the town closest to Incan archeological site Machu Picchu) and that the conditions were excruciating. Luckily, helicopters eventually evacuated all the tourists from the town.
Unfortunately, my Kiva clients in Cusco don’t have that luxury.